Popular crypto trader and analyst Benjamin Cowen says Bitcoin could face a few months of bearish price action if it fails to stay above a key metric.
BTC is trading at $46,143 at time of writing, down sharply from its weekly high of $52,774 after plunging on Tuesday, according to CoinGecko.
However, the largest crypto asset by market cap is still trading above its 20-week simple moving average (SMA), says Cowen.
“On some exchanges, we had a wick right down to the 20-week moving average… so clearly some people are wanting to hold the line at the 20-week moving average and are hoping that it holds as support so that we can have the confidence to ultimately push to $100,000. Now remember, these moves to the 20-week are par for the course in a bull market.”
The analyst tells his 532,000 YouTube subscribers that Bitcoin will probably need to hold the 20-week SMA in order to have a sustained rally for the next several months. If BTC closes two consecutive weeks below the 20-week SMA, Cowen says it likely will enter a three-month bear market before turning bullish again in 2022.
“Even in a bull market that should take us to $100k, going to the 20-week moving average is something that happens a lot of times, and if we don’t hold it, I think we just kick the can down the road, and then we’ll hold it in a few months.
The 20-week SMA again now is coming in just over $42,000.”Don't Miss a Beat – Subscribe to get crypto email alerts delivered directly to your inbox
Follow us on Twitter, Facebook and Telegram
Surf The Daily Hodl Mix
Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
Featured Image: Shutterstock/IM_VISUALS